Get rid of Mortgage or not?

Chris60

Next year I will be in a position to reapy my mortgage in full. Hoorah! However, I need a kitchen extension and the money won't run to both. So.......do I repay the mortgage and get a loan for the extension or pay for the extension and whatever I have left pay off part of the mortgage with?? Any advice will be much appreciated.

Badger_Lady

Assuming you definitely want the extension:

- Can you get a loan for a better rate than the mortgage? I'm guessing not...
- What rate are you getting on your savings? Better than the mortgage?

In your two options:

Option A - pay off the mortgage and get a loan
- You no longer owe anything to the mortgage company
- You do owe the loan company, and will be paying at X%APR for X years
- You do not have any savings earning you interest

Option B - use savings to do extension
- You still owe £X to the mortgage company at X% for X years
- You do not owe the loan company anything
- You do not have any savings earning you interest

Fill in the X's!

Chris60

Thanks Badger Lady that's decided me - I will not be taking out a loan. Much appreciated I just needed that push and confirmation of the best way forward.